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Gold rises above $900 after U.S. jobs data; copper falls

MomingZhou

NEW YORK (MarketWatch) -- Gold rose Thursday above $900 for the first time in nearly three weeks after data showed a big increase in claims for U.S. unemployment benefits, raising economic worries and increasing the precious metal's value as a safe asset. Copper fell for a fourth session.

Gold for June delivery gained $14.10, or 1.6%, to $906.60 an ounce on the Comex division of the New York Mercantile Exchange. May copper lost 5.95 cents, or 2.9%, to $1.992 a pound. Meanwhile, May silver gained 45 cents, or 3.7%, to $12.755 an ounce.

Thursday's gain in gold followed its 1% advance in the previous session as gloomy earnings reports from Morgan Stanley and Boeing reinforced economic worries.

"Fund buyers returned" after the economic data, said George Gero, a precious-metals trader for RBC Capital Markets. "Silver dragged up by gold somewhat."

James Moore, an analyst at TheBullionDesk.com, said a successful break above $900 will open the way to retest $940.

June gold had been trading below the $900 level since early this month.

First-time claims for state unemployment benefits rose a seasonally adjusted 27,000 to 640,000 in the week ended April 18, the Labor Department reported Thursday. For the week ended April 11, the number of people collecting state unemployment benefits reached another new record of 6.14 million.

The global economy is set to decline by 1.3% in 2009, the International Monetary Fund said in a report earlier this week. The UK will see its economy shrink by 4.1%, Japan by 6.2%, and the U.S. economy is expected to decline by 2.8%, the IMF said.

Holdings in SPDR Gold Trust
GLD, -1.05%
the biggest gold exchange-traded fund, stood at 1,105.98 tons Wednesday, unchanged for a third session, according to the latest data from the fund.

In other metals, copper has been declining since it closed at $2.194 last Friday, the highest level since mid-October and up more than 50% from February's low below $1.40.

June palladium slid 80 cents, or 0.3%, to $232.50 an ounce. July platinum added $9.30, or 0.8%, to $1,188 an ounce.

Platinum gross surplus rose above 260,000 ounces in 2008, more than triple from a year ago, as auto catalyst fabrication demand was hurt by weaker vehicle production, according to a report by GFMS Ltd. released on Thursday.

A slump of more than 10% in platinum jewelry fabrication also helped boost platinum surplus, the London-based precious metals consultancy said.

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